Pilcher and Pilcher (No.2)

[2018] FCCA 260

FEDERAL CIRCUIT COURT OF AUSTRALIA

PILCHER & PILCHER (No.2) [2018] FCCA 260

Catchwords:
FAMILY LAW – Property settlement – whether the wife ought be permitted to adduce further evidence as to the value of the former matrimonial home in circumstances where the Court is currently engaged in writing its judgment in the substantive proceedings and where a similar Application was dismissed some two months prior to this Application being filed.

Legislation:

Family Law Act 1975 (Cth), s.79

Cases cited:

Port of Melbourne Authority v Anshun Pty Ltd (1981) CLR 589
Damiani & Damiani [2010] FamCA 217
Blackman and Blackman [1998] FamCA 1
Henderson v Henderson [1843] 67 ER 313
D A Christie Pty Ltd v Baker [1996] 2 VR 582

Applicant: MS PILCHER

Respondent: MS PILCHER

File Number: MLC 4567 of 2015

Judgment of: Judge Small

Hearing date: 25 January 2018

Date of Last Submission: 25 January 2018

Delivered at: Melbourne

Delivered on: 6 February 2018

REPRESENTATION

Counsel for the Applicant: Dr Smith

Solicitors for the Applicant: Pearsons Lawyers

Counsel for the Respondent: Ms Johnston

Solicitors for the Respondent: Clancy & Triado

ORDERS

1. The Application in a Case of the wife filed 7 December 2017 is hereby dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Pilcher & Pilcher (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 4567 of 2015

MS PILCHER

Applicant

And

MR PILCHER

Respondent

REASONS FOR JUDGMENT

Introduction

1. This is the second Application in a Case filed by the wife in these proceedings during the period when the Court has been preparing judgment in the substantive proceedings (“the substantive judgment”).

2. The substantive proceedings in this case are for property settlement arising from the breakdown in the marriage between Ms Pilcher (formerly Pilcher) (“the wife”) and Mr Pilcher (“the husband”).

3. The major asset of the parties is the property at Property A (“the Property A property”).

4. At the trial of the substantive proceedings, conducted on 7, 8 and 9 March 2017, it was common ground that the husband would retain the Property A property and pay the wife a sum of money to be determined by the Court by way of property settlement between the parties.

5. At that time the parties agreed that the Property A property was worth $1,350,000 pursuant to a sworn valuation dated 30 January 2017 which was prepared by Mr S of (omitted) Valuations (“Mr S”) and filed on 6 February 2017. I note that that valuation was an update of a previous one dated 30 June 2016, also prepared by Mr S, which valued the Property A property at $1,260,000.

6. These Reasons relate to the determination of the wife’s Application in a Case filed 7 December 2017 (“the present Application”), in which she again seeks that she be permitted to adduce further evidence about the value of the Property A property in the intervening period between the end of the final hearing and the delivery of the Court’s judgment in the substantive proceedings.

Background

1. Ms Pilcher was born on (omitted) 1958 and is currently 59 years old.

2. Mr Pilcher was born on (omitted) 1953 in (country omitted) and is currently 64 years old.

3. The parties commenced living together in (omitted) 1999 and married on (omitted) 2006. They temporarily separated between (omitted) and (omitted) 2010. On 23 February 2015 the parties separated on a final basis under the same roof.

4. Mr Pilcher vacated the Property A property as a result of an Intervention Order to which he consented without admissions on 24 August 2015.

5. The wife has been living in the Property A property since that time, but she has been responsible only for the regular outgoings of the property, such as the utilities and the rates.

6. Mr Pilcher has paid all instalments on the (omitted) Account secured by a mortgage over the property since the date of separation.

Procedural History

1. As already stated, the Final Hearing of the property dispute between the parties was heard on 7, 8 and 9 March 2017, and at the conclusion of submissions on 9 March 2017 I reserved my decision, informing the parties that, because of a backlog of cases awaiting judgment, I would not be able to give judgment for “at least six months”. I note that the transcript of proceedings shows that I informed the parties of that fact on both the first and last days of trial.

2. The wife filed an Application in a Case on 8 September 2017 (“the first Application”), almost exactly 6 months after the completion of the trial.  At that time, I estimated that the first draft of the substantive judgment was between one-half and two-thirds complete.

3. The first Application sought the following orders:

   1.That all times be abridged to enable this Application to be listed, heard and determined with priority.

   2.That Judgment in these proceedings be stayed pending further evidence.

   3.That the Applicant Wife have leave to adduce further evidence.

   4.That the parties re-engage (omitted) Valuations as single expert witness to prepare a further and up to date valuation of the former matrimonial home property at Property A.

   5.That the parties pay the costs of the single expert witness equally.

   6.Such further and/or other orders and directions as are deemed appropriate or necessary in the circumstances.

4. As soon as I became aware of that Application, I ceased to write the substantive judgment.

5. The husband filed a Response to an Application in a Case on 5 October 2017 accompanied by an affidavit sworn by him on the same date.

6. In that Response, the husband sought simply that the Application in a Case filed 8 September 2017 be dismissed and that the Applicant pay his costs of and incidental to that Application.

7. The matter was listed for hearing on 10 October 2017 and, after hearing submissions from Mr Williams, counsel for the wife, and Dr Ingleby, counsel for the husband, I delivered judgment on Friday 13 October 2017, publishing my Reasons.

8. The order I made on that day was, simply,:

   1.The Application in a Case filed 8 September 2017 is hereby dismissed.

9. No order was made in relation to costs on that day.

10. The wife did not appeal that decision and I returned to writing the substantive judgment after 10 November 2017, that is, after the appeal period had elapsed.

11. Of course, in the period between the filing of the first Application on 8 September 2017 and the expiration of the appeal period on 10 November 2017, I had not been idle when not actually sitting on the bench. I had turned my mind to the next judgments on my reserved judgements list and had begun writing two more. I had also added to the draft Reasons for Judgment in the substantial proceedings in this matter.

12. On 7 December 2017, the wife filed a further Application in a Case (“the present  Application”), seeking the following orders:

    1.That all times be abridged to enable this Application to be listed, heard and determined with priority.

    2.That Judgement in these proceedings be stayed pending further evidence.

    3.That the Applicant Wife have leave to adduce further evidence and in particular a report and valuation by (omitted) as to the current market value of the former matrimonial home property situate at and known as Property A.

    4.Such further and/or other orders and directions as are deemed appropriate or necessary in the circumstances.

13. Again, as soon as I became aware of the filing of that Application, I ceased writing the substantive judgment.

14. The husband filed a Response to an Application in a Case on 12 December 2017, seeking the dismissal of the present Application and that the wife pay his costs of that Application.

15. Mr Pilcher swore and filed an affidavit in support of that Response on 12 December 2017. In that affidavit, after setting out the history of the substantive proceedings and the first Application, the husband deposes as follows:

    12.The matter that Ms Pilcher seeks to re-open has been dealt with by this Honourable Court and I consider that the matter is closed.

    13.I therefore seek orders that Ms Pilcher's December 2017 Application in a Case be dismissed, and that Ms Pilcher be responsible for my costs of and incidental to the application.

16. Mr Pilcher annexes to that affidavit a copy of my Reasons for Judgment in the first Application.

17. The present Application came before me on 15 December 2017, where, after discussions with counsel for both parties, I made the following orders:

    1.The Application in a Case filed 7 December 2017 be adjourned to the Federal Circuit Court of Australia on 25 January 2018 at 10:00 a.m. for an interim hearing.

    2.The Applicant shall file written submissions no later than 4:00 p.m. on 11 January 2018.

    3.The Respondent shall file written submissions in response no later than 4:00 p.m. on 18 January 2018.

    4.The parties costs of this day are reserved.

18. The wife filed written submissions prepared by her counsel, Dr Robin Smith (“Dr Smith”), on 11 January 2018, and the husband filed submissions prepared by his counsel, Ms Laura Johnston (“Ms Johnston”), on 18 January 2018.

19. I heard further submissions from Dr Smith and Ms Johnston at the hearing on 25 January 2018 (“the hearing”)[1], and made the following Orders:

    1.The matter be adjourned to the Federal Circuit Court of Australia on 5 February 2018 at 2:15 p.m. for the delivery of judgment.

    2.In the event that the Wife is unsuccessful in her Application in a Case filed 7 December 2017, and the Husband wishes to pursue his costs of that Application, he shall file written submissions in relation to the issue of costs no later than 14 days after delivery of judgment in relation to that Application, and the Wife shall filed her submissions no later than 14 days after service upon her of the Husband’s submissions.

    3.Otherwise, judgment on the Application in a Case filed 7 December 2017 is reserved.

    [1] Ms Pilcher was not present at the hearing, having undergone surgery on the previous day. Neither party gave oral evidence at the hearing on 25 January 2018.

Issues and Evidence

1. As was the case in the first Application, the single substantive issue in the present proceedings is whether I should allow the wife to adduce further evidence in relation to the value of the Property A property before completing my substantive judgment.

2. However, the written submissions of the husband, prepared by Ms Johnston, raise the issues of res judicata and/or issue estoppel, and abuse of process.

3. That is, the husband says that the question of whether to re-open the matter to adduce further evidence about the value of the Property A property was decided in my decision handed down on 13 October 2017 , and that the present Application is an abuse of process.

4. I must therefore deal with that issue before I can address the substance of the present Application.

5. Ms Johnston’s written submissions on behalf of the husband were filed on 18 January 2018 and Dr Smith’s, on behalf of the wife, were filed on 11 January 2018, he having understood, correctly as it turns out, that the husband would be raising these issues at the hearing.

6. Ms Johnston’s written submissions set out the history of the substantive proceedings and the first Application, and then submits that:

   9.  The husband seeks that the wife’s second application be dismissed based on principles of res judicata/issue estoppel and/or abuse of process.

7. Ms Johnston then refers to the decision of the High Court of Australia in Port of Melbourne Authority v Anshun Pty Ltd (1981) CLR 589, (“Anshun”) saying:

   10.In Port of Melbourne Authority v Anshun Pty Ltd (1981) CLR 589 at 597, the High Court set out previous authorities which have sought to explain the concepts of res judicata and issue estoppel:

   10.1 Res Judicata: “where an action has been brought and judgment has been entered in that action, no other proceedings can thereafter be maintained on the same cause of action” (by reference to Jackson v Goldsmith (1950) 81 CLR 446); and

   10.2 Issue estoppel: “a judicial determination directly involving an issue of fact or law disposes once and for all of the issue, so that it cannot afterwards be raised between the same parties or their privies” (by reference to Blair v Curran (1939) 62 CLR).

8. Ms Johnston submits that these principles apply to family law cases by referring to the judgment of Watts J in Damiani & Damiani [2010] FamCA 217, where his Honour accepted that the concepts of res judicata and issue estoppel are applicable to family law property cases because of “the public interest in finally determining the dispute and avoiding unnecessary litigation. Another (reason) is to avoid inconsistent judgments.”

9. Ms Johnston then states the basis for her submission on this point:

   12. The wife’s application for leave to adduce further evidence in the form of a valuation was heard and determined as part of her first application. The wife’s application was dismissed. She did not seek to appeal that decision. She cannot now seek that her application be re-determined.

10. Ms Johnston submits that it was the wife’s application for leave to adduce further evidence in the form of a sworn valuation that was heard and determined on 13 October 2017, and not merely an application to seek leave to adduce further evidence. In those circumstances, says Ms Johnston, the fact that the wife now has a sworn valuation, when in the first Application she had only market appraisals, is irrelevant.

11. I note that in the first Application, the wife sought an order for leave to adduce further evidence, and a separate order for the parties to obtain an updated valuation of the Property A property by the original valuer.

12. In the present Application, she seeks leave to adduce further evidence “and in particular a report and valuation by (omitted) as to the current market value of the former matrimonial home property situate at and known as Property A”.

13. Further, says Ms Johnston, “the wife’s first application was not dismissed on the basis of there being no sworn valuation. The dismissal of the wife’s application was far broader, having regard in particular to paragraphs 32, 33, 34, 36, 40 and 54 of the Reasons for Judgment”.

14. Having re-read my Reasons for Judgment in the first Application, I find some force in that submission.

15. Returning to the High Court’s judgment in Anshun, Ms Johnston refers to their Honours quoting with approval English authority which states:

    res judicata for this purpose is not confined to the issues which the court is actually asked to decide, but….it covers issues or facts which are so clearly part of the subject matter of the litigation and so clearly could have been raised that it would be an abuse of the process of the court to allow a new proceeding to be started in respect of them.

16. She says that that principle was accepted by the Full Court of the Family Court in Blackman and Blackman [1998] FamCA 1, where their Honours quoted with approval from Henderson v Henderson [1843] 67 ER 313 in the English Court of Chancery, where Sir James Wigram VC said:

    “where a given matter becomes the subject of litigation in, and adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of the litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time”.

17. Ms Johnston says that Ms Pilcher’s failure to provide a sworn valuation in support of her first Application was a failure to bring forward all relevant evidence at the time of making that Application, and that she should not be permitted to do so now.

18. Ms Johnston is aware that the principles of res judicata and issue estoppel only apply to final determinations, and in anticipation of an argument that my decision on 13 October 2017 might not be a final determination as it was the result of an Application in a Case, Ms Johnston refers to the decision on the Victorian Court of Appeal in D A Christie Pty Ltd v Baker [1996] 2 VR 582.

19. In that case, the Court found that even if the circumstances of the case do not give rise to the principles of res judicata or issue estoppel, the Court is able to find that the bringing of the case is an abuse of the court’s process in circumstances where the applicant seeks to “put forward …. material which was available… at the time of the first application”, and no explanation has been proffered for why that material was not put forward at that time.

20. As Ms Johnston then says:

    24. The wife, in her second application, has sought to file further material (i.e. the sworn valuation) to deal with alleged gaps in the material in the first application. It was always open to the wife to file a sworn valuation as part of the first proceedings. She did not do so, and proffers no explanation as to why. The second application ought to be dismissed as an abuse of process.

21. In his written submissions, Dr Smith rests his case in relation to the res judicata/issue estoppel argument on his submission that the second Application “differs substantially from the September Application in a Case”. He says, at paragraph 60:

    The basis of this submission is twofold:

    60.1.First, there is now sworn evidence before the Court that the real property has increased in value.

    60.2.Second, further time has passed without a decision being handed down by the Court.

22. Dr Smith refers to my Reasons for Judgment in the first Application where I noted that there was, at that time, no sworn valuation before the court to support the wife’s application to re-open the case. He says that that deficiency has been rectified and now there is a sworn valuation. Therefore, he says, the present application is different from the first application.

23. Dr Smith submits that the wife’s updated valuation in this case could not have “by reasonable diligence have been discovered earlier” because it only became an issue after the trial.

24. He says:

    50.    The parties engaged a joint valuer to ascertain the value of the real property for the purposes of the litigation.

    51.    However, it was not imagined at trial that judgement would be reserved for a period of over 10 months. In Her Honour’s judgment of 13 October 2017, Judge Small noted that:

    [22]…I had made it clear to the parties on that day [9 March 2017] that it was most unlikely that judgment would be handed down within six months given the workload of the court.

    52.    This seems to have occurred after the conclusion of the parties’ evidence. 

25. While it is true that the particular kind of evidence sought to be adduced could not have been adduced at trial, it could have been adduced in proper form when the wife filed the first Application in September 2017. Dr Smith conceded as much at the hearing.

26. It was the choice of the wife (in consultation no doubt with her legal advisors) to provide only market appraisals and to word her first Application in terms of seeking an order for an updated valuation. She could, had she so chosen, have obtained an updated sworn valuation, whether from Mr S or Mr G or some other valuer, and filed that valuation with her first Application.

27. In my view, the first Application was an application to re-open the proceedings in order to adduce further evidence about the value of the Property A property by way of obtaining a sworn valuation.

1. The present Application is an application to re-open the proceedings in order to adduce further evidence about the value of the Property A property by way of an already- obtained sworn valuation.

2. I can see no difference in substance between those two Applications, despite Dr Smith’s submission at the hearing that the fact that the two Applications refer to different valuers makes them different Applications, and therefore the wife’s argument that there is now a sworn valuation which makes her present Application different from her first, is rejected.

3. In the case of Dr Smith’s second submission[2], that further time has passed since I delivered my decision in the first Application, thus making the present Application different from the first, the argument is a little different.

   [2] Dr Smith referred to this submission as containing “the substantive difference” between the two Applications in his submissions at the hearing on 25 January 2018, and stated that this was “the fundamental point” in the present Application.

4. Dr Smith argues that the two Applications are “on their face” different simply because they were filed two months apart.

5. I asked him at the hearing whether an acceptance of that argument might not “open the floodgates” and mean that any litigant whose matter is not finally determined within a couple of months of trial could return to the court during that period and seek to adduce further evidence. When I asked him to clarify whether that was what he meant, Dr Smith said:

   It is, yes. Whether on the res judicata point, or the issue estoppel point, yes. That is my submission.

6. When I asked him whether his client would be filing a further application because the valuation obtained in the present Application was now a further two months out of date, Dr Smith stated:

   Clearly, I don’t have instructions to do that.

7. In the circumstances of this case, I find this submission a little disingenuous.

8. The only reason the substantive judgment was not completed by the end of September 2017, that is, about six-and-a-half months after trial, is that the wife made an Application to re-open the case on 8 September 2017. I was unable to return to the writing of the substantive judgment until after the appeal period for my decision to dismiss that Application had elapsed. In the meantime, I had begun to write other judgments (several of which, ironically, have now been delivered), and did not think it reasonable to abandon those judgments in mid-writing because of the wife’s first Application.

9. The delay, had I been able to complete the substantive judgment by 30 September, would have been about six-and-a-half months, just as I had advised the parties at trial. It is now ten months solely because of the wife’s two applications to re-open the case.

10. As I said to Dr Smith at the hearing, it is a little like the proverbial case of the man who murders his parents and then pleads for mercy from the court because he is an orphan.

11. In addition, the transcript for the first day of trial shows that I advised the parties on that day, as well as at the end of the evidence, that there would be at least a six month delay before I would be able to deliver judgment.

12. There was no application by the wife at trial for the valuation of the Property A property to be updated at the end of that period, or at any other time, until the date of filing of her first Application.

13. I therefore do not accept Dr Smith’s submissions in relation to the further two months (now four months) period of time having elapsed as constituting a “difference” between the first and present Application.

Conclusion

1. After considering all the above matters, I find that the present Application does not differ from the first because both seek to re-open the substantive proceedings in order to adduce sworn evidence of a rise in the value of the Property A property, and because any time delay in the delivery of the substantive judgment beyond the “at least six months” of which the parties were advised at trial is due entirely to the actions of the Applicant.

2. In those circumstances, the principle of res judicata/issue estoppel applies, and I cannot find that it is in the interests of justice to exercise my discretion and allow the wife to adduce further evidence in this matter.

3. In those circumstances it is not necessary for me to decide whether the present Application is an abuse of process.

4. I will therefore dismiss the Application in a Case filed 7 December 2017.

5. Once the 28 day appeal period expires in relation to this decision, I will return to the writing of the substantial judgment as a matter of priority, but even then, it is unlikely that that judgment will be delivered before mid-March 2018, almost exactly a year after the trial.

6. The first six months of that delay is due to the workload of the Court, as explained at trial and in my reasons for Judgment in the first Application.

7. However, any delay after that time is due entirely to the wife’s two unsuccessful Applications in a Case seeking to re-open the proceedings.

I certify that the preceding seventy eight (78) paragraphs are a true copy of the reasons for judgment of Judge Small

Date:  6 February 2018